Medicaid Expansion Report Calculates Modest State Costs

John Commins, for HealthLeaders Media, November 27, 2012

States that expand their Medicaid rolls under the Patient Protection and Affordable Care Act would see only modest increases in their share of the costs when compared with the windfall in federal funding that would come with it.

That's according to a new report released Monday by the Kaiser Family Foundation that also suggests that some states could net budget savings under the expanded Medicaid rolls, as millions of poor and uninsured people gain coverage. 

>>>VIEW SLIDESHOW

According to the analysis, which was written by the Urban Institute for KFF's Commission on Medicaid and the Uninsured, if all 50 states expand their programs, state Medicaid spending nationally would increase by $76 billion from 2013 to 2022, an increase of less than 3%.

For the same period the federal Medicaid match would increase by $952 billion, or 26%. With the expansion, an additional 21.3 million people could gain Medicaid coverage by 2022 and with other coverage provisions of the PPACA that would cut the uninsured by 48%.

Alan Weil, executive director of the National Academy for State Health Policy, told reporters in a KFF conference call Monday that the funding for the Medicaid expansion has to be put into its proper context.

"We are talking about healthcare and healthcare is expensive," Weil says. "It's fairly easy to have a little sticker shock at the potential costs of various policy options in this area. But what this report does very effectively is place the spending burden that states would face if they choose to expand Medicaid in the context of overall spending."